On these pages last week, Professor John Sutherland made some eccentric observations, including some about the government's plans for higher education, but he misrepresents what we value and how we will support that.

The government is committed to the principle that going to university should depend on ability – not the ability to pay. Our proposal is for a system of graduate contributions that is fair for all.

My biggest concern is that young people currently at school or college do not appreciate how the system will actually work. During the first student demonstrations in London, for instance, one teenager said in an interview that higher contributions would make it impossible for her to fulfil her ambition to become a teacher. She explained that she could no longer afford to pursue that worthwhile career. This is simply not the case, and I do not want anyone to be put off from going to university through such misunderstanding.

Let's use the example of this young woman. First, she will not have to contribute to the cost of her tuition until after she graduates and is earning an income.

Second, as a newly qualified teacher, she will repay less per month than recent graduates currently do. The starting salary for a newly qualified teacher today is around £21,500 (outside London). Someone on this wage would make monthly repayments at the rate of 9p in the pound, but only on income over £21,000 (the current threshold is £15,000). This would mean repayments of less than £4 per month.

Graduates who earn more will repay more each month, so the system is fair and affordable; and those who enter a more lucrative profession will pay a higher rate of interest, and ultimately contribute more to the cost of their university education.

Monthly repayments depend on income alone, so if graduates leave the labour market, their repayments will stop until they're earning again.

And third, the government is introducing a range of support for students from less affluent families for which she may well be eligible. These include more generous living grants and a new £150m national scholarships programme, which could offer a free first year for students from the most disadvantaged backgrounds. All told, our repayment model is far more generous than anything on offer in the US, where commercial rates can apply.

As a result, we estimate that around one quarter of graduates on the lowest incomes will actually pay back less than under the current system. We also expect that around one million students will be eligible for more help with their living costs than at present.

We are not, therefore, placing a heavier financial burden on people least able to afford it. On average, a university graduate earns £100,000 more during his or her lifetime – net of tax – than someone who leaves school at 18.

Besides our desire to make the finances of universities more sustainable than they are now, we are just as committed to improving students' experience of university. Universities that offer the best teaching arrangements and facilities – and can demonstrate that their graduates are successful – will themselves be more successful at recruiting applicants.

The government's wish to place a greater emphasis on high-quality teaching is consistent with the very idea of a university. Academics who devote time to teaching are often precisely the ones who most inspire students. So we are looking at ways to reward lecturers who excel in teaching, in order to challenge the perception that university staff must publish or perish.

Remember too that, in challenging fiscal circumstances, we have maintained the overall level of funding for science and research programmes for the next four years – guaranteeing the stable investment that academics depend upon.

Finally, the success of this country's HE sector – now and in future – rests on its autonomy. Our proposals will free universities to build more distinctive relationships with their students and to grow.